Earned Income Tax Credit (EITC)
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The Basics
The Earned Income Tax Credit (EITC) is a federal tax program that reduces the amount of income tax owed by low to moderate income workers and families. Even people who don’t earn enough to owe federal income taxes may get a refund from the Internal Revenue Service (IRS) if they qualify for an EITC.
The EITC for tax year 2023 (filing by April 2024) ranges from $2 to $7,430. To qualify, you must have income from employment, self-employment, or employer-paid disability benefits received prior to retirement. There is no limit to the number of times you can claim an EITC; you can claim one every year that you qualify. Families with a permanently and totally disabled child will always qualify for an EITC, as long as they meet other program requirements. Those requirements are discussed in this article and can be found on the IRS website.
There is also an Earned Income Tax Credit for California state income taxes. The California Franchise Tax Board has more information about the state EITC.
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Earned Income Tax Credit (EITC)
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Eligibility
The Earned Income Tax Credit (EITC) is designed to assist people with limited incomes by reducing the amount of federal income tax they owe. Even those who don’t earn enough money to owe federal income taxes may be eligible for an EITC.
The credit can be claimed when filing your annual federal tax return. For tax year 2023 (filing by April 2024), the EITC ranges from $2 to $7,430, depending on your adjusted gross income and the number of qualifying children in your family. There is no limit to the number of times you can claim an EITC; you can claim one every year that you are eligible.
|
No Children |
1 Qualifying Child |
2 Qualifying Children |
3 or More Qualifying Children |
---|---|---|---|---|
Single |
AGI limit: $17,640
Max credit: $600
|
AGI limit: $46,560
Max credit: $3,995
|
AGI limit: $52,918
Max credit: $6,604
|
AGI limit: $56,838
Max credit: $7,430
|
Married (filing jointly) |
AGI limit: $24,210
Max credit: $600
|
AGI limit: $53,120
Max credit: $3,995
|
AGI limit: $59,478
Max credit: $6,604
|
AGI limit: $63,698
Max credit: $7,430
|
* Figures are for tax year 2023 (filing by April 2024). |
Program Eligibility
To be eligible for the Earned Income Tax Credit you must meet several criteria:
- You must meet adjusted gross income requirements (see table above).
- You must have earned income from employment, self-employment, or employer-paid disability benefits received prior to retirement.
- You must have a Social Security Number valid for employment.
- You cannot file your taxes as “married filing separately.” If you’re married, you must file a joint tax return.
- You must be a U.S. citizen or resident alien. If not, you must be married to a U.S. citizen or resident alien and filing a joint tax return.
- You must live in the U.S. for more than half of the year.
Age Requirements:
- If you are claiming qualifying children, you can be any age.
- If you’re not claiming a qualifying child, you must be 25 to 64 years old.
Additional requirements:
- You cannot claim foreign income or a foreign housing deduction using Form 2555.
- You must not have investment income that exceeds $11,000 (for tax year 2023).
- You cannot be the dependent of another person.
- You cannot be the qualifying child of another person.
More on Earned Income
To qualify for an EITC, you must receive earned income. This can include your wages, salaries, tips, net earnings from self-employment, or any other form of taxable pay. You can also elect to include nontaxable combat pay as earned income.
Employer-paid disability payments received prior to retirement are considered earned income under the EITC program. But benefit payments received from a policy you paid the premiums for, or that you received post-retirement, would not be considered earned income.
Other items that do not qualify as earned income under the EITC include:
- Interest and dividends
- Social Security and railroad retirement benefits
- Pensions and annuities
- Alimony and child support
- Workers’ compensation benefits
- Unemployment compensation
- Welfare benefits
- Veterans’ benefits
If you are married and filing jointly, at least one spouse must receive earned income to be eligible for an EITC.
Adjusted Gross Income
In addition to the earned income requirement, you must have an adjusted gross income (AGI) below certain levels to qualify for an EITC.
Your adjusted gross income (AGI) includes all earned income before deductions for taxes, health care or other expenses, minus certain business, education-related, and other expenses. While filling out your annual tax return (IRS Form 1040), you will be asked a series of questions that will allow you to determine what your AGI is.
John earned $30,000 in wages for the year before taxes and other deductions were taken out of his paychecks. He also earned $4,000 in employer-paid disability insurance payments for the year. He had no deductions for business, education-related, or other expenses. According to the IRS program, John’s adjusted gross income would be $34,000—his gross wages plus payments received from the employer-paid disability insurance.
Adjusted Gross Income and Qualifying Children
For a child to be considered a qualifying child under EITC, several requirements must be met:
- Relationship: The child must be your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, or a descendant of any of these (for example be your grandchild, niece, or nephew).
- Residence: Generally, the child must live in the same place as you for more than half the year and have a valid Social Security number. (There are some exceptions to this. For an overview, click here. For the complete list, you can read Publication 596 from the IRS.)
- Age: At the end of the tax year, the child must be under 19. Or, if attending school full-time, the child must be under 24. The only exception is for children who are permanently and totally disabled. If your child is permanently and totally disabled, the child can be any age, even an adult.
According to the IRS, a person is considered “permanently and totally disabled” if their condition is expected to last continuously for at least one year or is expected to result in death, and if they cannot perform any Substantial Gainful Activity (SGA). For tax year 2023, this means they cannot earn more than $1,470 per month ($2,460 per month if they are blind).
Note: Qualifying children can only be used by one family member to claim an EITC.
If you don’t have any qualifying children, the maximum adjusted gross income you can have and still qualify for an EITC is $17,640 ($24,210 for a couple).
With one qualifying child, your AGI can be up to $46,560 ($53,120 for a couple). With two or more qualifying children, you can have an AGI of up to $52,918 ($59,478 for a couple). And with three or more qualifying children, you can have an AGI of up to $56,838 ($63,698 for a couple).
Sources
If you are eligible for an EITC, you can get free tax preparation help through a Volunteer Income Tax Assistance (VITA) Center. Most centers can e-file your return for free. If you are self-employed, have all your receipts and a log of expenses ready for the tax preparer. To find a local VITA Center, check the Franchise Tax Board or the IRS VITA Site List.
IRS Publication 596 is a comprehensive guide to the EITC. It includes information on program rules, calculating and claiming an EITC, rules regarding qualifying children, and sample worksheets.
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Earned Income Tax Credit (EITC)
- The Basics
- Eligibility
- Claiming Your EITC
- EITC and Other Programs
- FAQs
- Pitfalls
- Resources
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Claiming Your EITC
If you qualify, you will claim your Earned Income Tax Credit when you file your federal tax return. To calculate the value of your EITC, you can use the Earned Income Credit Worksheet in your IRS Form 1040 instruction booklet. If you have a qualifying child, be sure to attach a Schedule EIC. You can ask the IRS to calculate your tax credit for you by noting an “EIC” on the Earned Income Credit line on your tax return.
To see if you qualify for an EITC, and how much it might be, use the IRS EITC Assistant.
Some Tips on Claiming an EITC and Tax Preparation
Keep all your W-2's and maintain a record of who you have worked for during the year. This will make things simpler when it comes time to file your taxes.
If you are on a limited income, do not pay someone to do your taxes. Use a Volunteer Income Tax Assistance (VITA) Center to file. Most centers can e-file your return for free. If you are self-employed, have all your receipts and a log of expenses ready for the tax preparer. To find a local VITA Center, check the Franchise Tax Board or the IRS VITA Site List.
Be sure to file your taxes, even if your income is so low that you are not legally required to file. You might be eligible for an EITC or some other tax credit. Many families with children who qualify for an EITC may also be eligible for a Child Tax Credit (CTC).
The following is a summary of the EITC requirements.
Requirements |
People without a Qualifying Child |
People with at least one Qualifying Child |
---|---|---|
Adjusted Gross Income |
$17,640 for a single person $24,210 for a married couple |
One qualifying child: $46,560 for a single person $53,120 for a married couple Two qualifying children: $52,918 for a single person $59,478 for a married couple Three or more qualifying children: $56,838 for a single person $63,698 for a married couple |
Social Security Number |
Social Security Number valid for employment |
Social Security Number valid for employment |
Tax Status |
Joint tax return if married, unless separated for more than 6 months |
Joint tax return if married, unless separated for more than 6 months |
Citizenship |
Must be a U.S. citizen or legal resident. Or if you’re a nonresident alien, you must be married to a U.S. citizen or legal resident and file a joint tax return |
Must be a U.S. citizen or legal resident. Or if you’re a nonresident alien, you must be married to a U.S. citizen or legal resident and file a joint tax return |
Foreign Income |
Cannot claim foreign income or a foreign housing deduction using Form 2555 |
Cannot claim foreign income or a foreign housing deduction using Form 2555 |
Investment Income |
Cannot have investment income that exceeds $11,000 |
Cannot have investment income that exceeds $11,000 |
Earned Income |
Must have earned income |
Must have earned income |
Relationship |
Does not apply |
The child must be your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, or a descendent of any of these (for example, grandchild, niece, or nephew) |
Age |
Must be 25 to 64 years old |
Adult: No age requirements Children: Under age 19 at end of the year Under age 24 at the end of the year and a full-time student, or Any age if permanently and totally disabled |
Residency |
Must live in the U.S. for more than half of the year |
Must live in the U.S. for more than half of the year, some exceptions apply |
Qualifying Child |
Cannot be the qualifying child of another person |
Must have at least one qualifying child Each qualifying child can only be used by one family member when filing for the credit |
Dependent Child |
Cannot be the dependent of another person |
Cannot be the dependent of another person |
Tax Forms |
1040 o have IRS figure the amount of your credit, enter “EIC” on the Earned Income Credit line of your tax form |
1040 AND Schedule EIC To have IRS figure the amount of your credit, enter “EIC” on the Earned Income Credit line of your tax form |
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Earned Income Tax Credit (EITC)
- The Basics
- Eligibility
- Claiming Your EITC
- EITC and Other Programs
- FAQs
- Pitfalls
- Resources
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EITC and Other Programs
Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI)
You must have some form of earned income to qualify for an EITC. Social Security benefits do not count as earned income under the program. You can, however, be on Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) and claim an EITC as long as you have some form of earned income, including income from self-employment.
Long-Term Disability Insurance
Employer-paid long-term disability insurance benefits received prior to retirement count as earned income under the EITC and can therefore be used to qualify for the program. Disability insurance benefits for which you pay the premiums, or that you receive post-retirement, are not considered earned income and cannot be used to qualify for an EITC.
Individual Development Accounts (IDAs)
Money received from an EITC can be deposited into an Individual Development Account and matched.
Plans to Achieve Self-Support (PASS)
Money received from an EITC can be set aside in a PASS.
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Earned Income Tax Credit (EITC)
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Frequently Asked Questions
What is the Earned Income Tax Credit (EITC)?

The Earned Income Tax Credit is a federal tax program that reduces the amount of income tax owed by low to moderate income workers. The credit ranges from $2 to $7,430 depending on your adjusted gross income and the number of qualifying children in your family.
Is the Earned Income Tax Credit (EITC) known by any other name?

The program is often referred to simply as the Earned Income Credit (EIC).
How often can I claim an EITC? 

You can claim an EITC every year that you qualify.
What are the eligibility requirements for an Earned Income Tax Credit (EITC)?

To be eligible for the Earned Income Tax Credit (EITC) you must:
- Have earned income from employment, self-employment or employer-paid disability benefits received prior to retirement.
- Meet adjusted gross income requirements.
- Have a Social Security Number valid for employment.
- File a joint tax return if married
- Be a U.S. citizen or resident alien. If not, you must be married to a U.S. citizen or resident alien and filing a joint tax return.
- Live in the U.S. for more than half of the year.
- Be 25 to 64 years old, if you aren’t claiming any qualifying children (if you are claiming qualifying children, you can be any age).
In addition, you cannot:
- Claim foreign income using Form 2555.
- Have investment income that exceeds $11,000 for tax year 2023.
- Be the dependent of another person.
- Be the qualifying child of another person.
Can I use my EITC in an Individual Development Account (IDA) or a Plan to Achieve Self-Support (PASS)?

How do I claim an EITC?

If you are eligible, you can claim an EITC while filing your annual federal tax return, IRS Form 1040. If you have a qualifying child, you will need to attach a Schedule EIC.
Does what I have in the bank and/or what I own affect my eligibility for an Earned Income Tax Credit (EITC)? 

While there are no asset requirements to claim the EITC, you cannot have investment income that exceeds $11,000 in tax year 2023 (filing by April 2024).
How do I know how much my EITC is worth?

The value of your EITC is based on your adjusted gross income and the number of qualifying children in your family. You can calculate your EITC yourself by using the Earned Income Credit Worksheet in Form 1040. Or you can ask the IRS to calculate it for you by noting an “EIC” in the Earned Income Credit line on your tax return.
For an estimate on the value of your EITC, use the Center on Budget and Policy Priorities Tax Credit Calculator.
When can I receive benefits from the Earned Income Tax Credit (EITC)?

You can claim your Earned Income Tax Credit when filing your annual federal tax return. The IRS can deposit the credit to your bank account or send you a check by mail. The method you chose and how early you file will determine how quickly you get your credit, but it is usually within 2-3 weeks of filing.
Do I have to meet any residency or citizenship requirements to qualify for an Earned Income Tax Credit (EITC)?

Yes. To qualify for the Earned Income Tax Credit, you must live in the U.S. for more than half the year. You must also be a U.S. citizen or resident alien. If not, you must be married to a U.S. citizen or resident alien and filing a joint tax return.
How do I know if I have a “qualifying child”?

To be a qualifying child under EITC rules, the child must
- Be related to you: The child must be your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, or a descendant of any of these (for example, be your grandchild, niece, or nephew)
- Live with you: Generally, the child must live at in the same house as you for 6 months or longer each year and have a valid Social Security number. (There are some exceptions to this. For the complete list of exceptions, read IRS Publication 596.)
- Be under the age of 19: At the end of the tax year, the child must be under 19. Or, if attending school full-time, the child must be under 24. The only exception is for children who are permanently and totally disabled. If your child is permanently and totally disabled, they can be any age, even an adult.
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Earned Income Tax Credit (EITC)
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Common Pitfalls
You can’t be above adjusted gross income limits
In order to claim the Earned Income Tax Credit, you cannot exceed maximum adjusted gross income levels. For people without a qualifying child, adjusted gross income must be below $17,640 ($24,210 for a couple). A person with only one qualifying child can have adjusted gross income up to $46,560 ($53,120 for a couple). Those with 2 qualifying children can have adjusted gross income up to $52,918 ($59,478 for a couple). Those with 3 or more qualifying children can have adjusted gross income up to $56,838 ($63,698 for a couple). The figures given here are for tax year 2023. Figures adjust annually.
You must have some earned income
You must have at least some earned income to qualify for an EITC. If you live completely on unearned income (including SSI or SSDI), you are not eligible. You also cannot claim foreign income or have investment income that exceeds $11,000 (for tax year 2023).
You must meet the age requirements
If you do not claim any qualifying children, you must be 25 to 64 years old to qualify for an EITC. If you have a qualifying child, there is no age requirement.
Your qualifying children must meet IRS criteria and can only be claimed once
Children must meet IRS relationship, residency, age, and support requirements to be considered “qualifying children” under EITC. Only one family member can claim the qualifying child or children on their tax return.
Married couples must file a joint return
If you’re married, you cannot file your taxes as “married filing separately” and qualify for an EITC. You must file a joint tax return.
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Earned Income Tax Credit (EITC)
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Resources
EITC Resources
The Internal Revenue Service (IRS) has a variety of information on tax preparation and filing, including Form 1040. Publication 596 is a comprehensive guide to the EITC, providing information on program rules, eligibility, qualifying children, and other related topics. You can use the IRS EITC Assistant to help figure our whether or not you qualify for an EITC.
The Center on Budget and Policy Priorities (CBPP) conducts research and analysis on fiscal policy and public programs that affect low- and moderate-income families and individuals. The CBPP website offers an overview of the Earned Income Tax Credit (EITC), as well as an array of publications and tools, including their Tax Credit Calculator.
For free tax preparation help, contact a Volunteer Income Tax Assistance (VITA) Center to file. Most centers can e-file your return for free. To find a local VITA Center, check the Franchise Tax Board or the IRS VITA Site List.
Getting Help with Your Benefits
If you get Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI), or Childhood Disability Benefits (CDB), and you're looking for a job, a trained Benefits Planner can help you avoid problems with your job plan. If you need help or have questions about your situation, you can call the Ticket to Work Help Line at 1-866-968-7842 or 1-866-833-2967 (TTY), Monday through Friday.
View DB101's full list of experts who can help you understand different benefits.
Community-Based Organizations
Various community-based organizations guide people through state, federal, public, and private health and income programs. Some organizations may work with specific populations while others work with people with any type of disability. Here are a few examples
Goodwill Industries services range from personal evaluation and office skills training to career counseling, childcare, and transportation. Some Goodwill Industries centers also do benefits planning for people who get SSI, SSDI, and Medicare. Find locations at www.Goodwill.org, or by calling (voice) 1-800-466-3945.
The California Foundation for Independent Living Centers lists centers serving people with all disabilities. Many of these centers do benefits planning for people who get SSI, SSDI, and Medicare. If they don't offer benefits planning themselves, Independent Living Centers can refer you to local benefits planners. Find the list of independent living centers at www.CFILC.org, or by calling (voice) 1-916-325-1690 or (TTY) 1-916-325-1695.
The California Department of Public Health's Office of AIDS lists 1,300 organizations offering HIV/AIDS services throughout California. Some of these organizations provide case management, benefits planning, and benefits counseling services that can include help with public and private benefits programs. You can search the list online, or call (voice) 1-800-367-AIDS (2437) or (TTY) 1-888-225-AIDS (2437).
Disability Rights California provides representation for consumers of public programs who are disabled. Website publications include topics on health care, benefit programs, and In-Home Supportive Services.
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Building Your Assets and Wealth
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Finding the Right Job for You
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